From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
HONG KONG RATTLES MARKETS
Stocks ended the week lower, snapping a record-setting run in an abbreviated week of thin trading. Better-than-expected economic data, from durable goods orders to weekly jobless claims to GDP revisions, all helped fuel the pre-Thanksgiving gains. Those data points were replaced, post-holiday, by fresh trade concerns, which deepened after President Trump signed a bill Wednesday in support of pro-democracy protesters in Hong Kong. That legislation, which among things authorized sanctions on Chinese officials involved in human rights abuses in Hong Kong, infuriated Beijing. The Chinese government said the bill "seriously interfered with Hong Kong affairs, seriously interfered with China’s internal affairs, and seriously violated international law and basic norms of international relations.” It remains unclear whether the bill, largely symbolic, will interfere with the trade negotiations between the world's two biggest economies. Despite the jitters, the S&P 500 finished its best month since June.
TRILLION-DOLLAR HOLIDAY?
Retailers are hoping for a huge Black Friday/Cyber Monday showing, but for many the shopping extravaganza began earlier than ever. This was the first Thanksgiving ever to surpass $4 billion in online sales, with nearly half coming from mobile devices, according to data from Adobe Analytics. Total online sales are projected to reach $144 billion for the full season. Despite economic concerns related to the ongoing trade war, unemployment is near record lows, consumer confidence is high, and people are opening their wallets. The analytics firm eMarketer is estimating this could be the first-ever $1 trillion holiday shopping season when all is said and done.
BUZZKILL
A bad year for cannabis stocks got worse, with the FDA's release of its first-ever warning about the health risks of the hugely popular CBD cannabis component. CBD was taken off a list of banned substances last year and has grown to become a pillar of the fledgling U.S. cannabis industry, with claims that it can help anxiety, inflammation and insomnia, without the psychotropic effects of THC. But federal regulators pumped the brakes on those claims, saying CBD has the potential to cause liver damage, changes in mood and gastrointestinal problems. Investors are worried the report could signal the FDA plans a crackdown on the CBD market, and the report sent shares of publicly-traded cannabis firms like Tilray, Aurora and Cronos lower. Some of those stocks recovered later in the week on expectations that they will see a boost from increased holiday spending.
MERGER MANIA
Two huge, industry-shaking mergers were announced at the start of the shortened week. The country’s two largest discount brokerages made it official, with, Charles Schwab shelling out $26 billion in an all-stock deal to acquire TD Ameritrade. The retail brokerage industry has been shaken up, with upstarts like Robinhood taking market share from established firms, leading Schwab, Ameritrade and others to cut, or do away entirely, with commission-based trades. Meanwhile, in retail, LVMH, the European luxury giant behind fashion brands like Louis Vuitton and Fendi, is buying Tiffany in a $16 billion acquisition. The iconic jeweler has been suffering from weak sales in the U.S. and is betting on an expansion in China to fuel growth. LVMH is credited with becoming one of the most valuable companies in Europe due, in large part, to the success of its brands in the Chinese market.
SLOW GOING FOR BOEING
The chances of the 737 Max getting the stamp of approval from the FAA before the end of the year is getting smaller by the day. The smart money is now betting that it will be January, at the earliest, before the Max is re-certified to fly. Regulators are reportedly planning to inspect every single new 737 Max and, even then, it would take several more weeks for airlines to get their Max fleets back into service. Adding to the concerns for Boeing: Congress is said to be planning another hearing for December in which FAA officials would testify about the safety procedures involved in certifying the Max before the two crashes that killed nearly 350 people. Boeing, ending a year in the midst of its biggest corporate crisis ever, has seen its shares lose 15 percent of their value since March, when the second crash led to the worldwide grounding of the Max jet.
This year's worldwide semiconductor shortage limited the supply of everything from new cars to smartphones; and now, many in the chip industry expect the shortage to continue deep into 2022, and maybe even 2023. Semiconductor senior research analyst for Robert W. Baird & Co., Tristan Gerra, joins Cheddar News' Closing Bell to discuss.
Direct health care company Nomi Health recently raised $110 million in a Series A round. Nomi Health lets public and private organizations directly purchase healthcare at reduced costs, and pay providers in real-time. It also delivers healthcare directly to under-served communities via its fleet of mobile care units, which the company says is the largest in the country. Nomi Health says its mission is to improve the health care experience for all Americans. Nomi Health CEO Mark Newman joined Cheddar News' Closing Bell to discuss.
American Express and Nova Credit have partnered the credit passport program aimed at expanding access to credit for immigrants from the Dominican Republic, Nigeria, Kenya, and Brazil. Misha Esipov, co-founder and CEO of Nova Credit, joined Cheddar's Ken Buffa to talk about the program's benefits for immigrants who have to start over in the U.S. and are looking to establish a credit history. "If you were a good borrower in your home country — and you can prove you were a borrower in your home country — when you first arrive here, you can use that information to continue to be a good borrower," he said of the service.
Despite the rising cost of a home in the U.S., sales rose 1.9 percent in November, and according to Zillow, prices are expected to climb even higher in 2022. M. Ryan Gorman, president and CEO of Coldwell Banker Real Estate, told Cheddar's "Closing Bell" that while median prices are high, demand for a new home is just as high, particularly in "tax and weather favorable" destinations like Florida, Tennessee, and Texas. Gorman also said he sees buyer demand remaining high next year even if interest rates rise somewhat, noting that the already tight housing inventory is expected to slim down even more and foreign purchasers return to the market. "As we get past the holidays and those foreign buyers are able to come back and actually acquire homes and go shopping, I think that may be a bigger driver of some of that increase in buyer demand," he said.
The airline industry says it is contending with staff shortages that threaten to hamper operations amid the COVID resurgence, andDelta Airlines CEO Ed Bastian called on the CDC to revise its guidance for vaccinated workers who test positive from a 10-day quarantine to just five. Chuck Liberman, chief investment officer and managing partner at Advisors Capital Management LLC, joined Cheddar to talk about the current guidance on isolation and why he believes the omicron variant calls for more relaxed guidance given its reportedly mild symptoms.
A new series is looking to advance Black founders who have disruptive ideas and companies. 'Bet on Black' is a new series that allows black entrepreneurs to pitch their businesses in the hopes of securing $200,000 in funding. Revolt TV and Target teamed up to create the show. Detavio Samuels, CEO of Revolt, joins Cheddar News to discuss.
Bitcoin's rise to the mainstream has been a wild ride this year. The cryptocurrency is trading a little under $49,000 Wednesday morning and is set to finish the year sharply higher than where it began earlier this year. Ether prices also soared this year, rising from $730 per coin to nearly $4,000. Ben Armstrong, founder of Bitboy Crypto, joins us to discuss what's in store for crypto in 2022.
The fitness industry was one of the most severely impacted at the start of the pandemic. As the omicron variant of COVID-19 threatens fitness centers and gyms, the Global Health and Fitness Association, along with the Community Gyms Coalition, are calling on the federal government to provide pandemic relief before the close of 2021. Crunch Fitness Franchise CEO Ben Midgely joined Cheddar to talk about proactive steps gyms are taking to maximize business as COVID resurges. "It should be a little bit easier," he said. "We hate to have to deal with it again, but it's what businesses in this country have to work with."
According to the FAA, airlines have reported over 5,000 incidents involving unruly passengers this year, with more than 3,600 of those involving people who refused to wear face masks. As a result of all this, airline crews are calling on the federal government to step in to implement protocols to help ensure safety on the ground and while in flight. President of the Association of Flight Attendants- CWA Sara Nelson, joined Cheddar to discuss more.
